Hey folks — if you’re scrolling Reddit at 2 a.m. wondering how the hell you’re going to survive your mortgage renewal with a 580 credit score and a 6.8% rate staring you down, this post is for you.
I’ve been watching threads like this one where Canadians are freaking out (understandably) about how insane rates are right now. Let’s break down what you can do if you’re in that boat.
First Off, You’re Not Screwed. But You’ve Gotta Act.
According to TransUnion Canada, about 20% of Canadians have a credit score below 650. You’re not alone — but the system isn’t designed to help you unless you push for help. The Bank of Canada’s rate is at 5.00%, and most big lenders are quoting 6.3–6.9% for 5-year fixed mortgages. If you’ve got bruised credit, alternative lenders could push that to 8–10%.
That’s why you need a strategy — not panic.
What to Do if Your Renewal is Coming Up and You Have Bad Credit:
- Don’t blindly renew. Talk to your lender early. If you’ve been making payments reliably, you might qualify for retention offers or short-term renewals with lower upfront pain.
- Ask your lender for options. Seriously — ask. RBC, Scotiabank, TD — all of them have internal hardship, deferral, or restructuring programs. The earlier you ask, the more flexibility they have.
- Improve your credit score — now. Pay down credit cards. Keep usage under 30%. Don’t open anything new. Even a 20-point bump could put you into a better rate bracket and save thousands in interest.
- Consider a mortgage broker. Some brokers specialize in helping people with less-than-stellar credit find private or credit union lenders. Their access goes beyond the Big 6 banks.
- Get a side hustle, fast. Shelter costs in Canada now average $1,900/month. If you can scrape $400–$500 from a side gig — DoorDash, Upwork, tutoring, whatever — that might be enough to make your new payment work.
- Short-term fix: Rent out a room. Airbnb? Basement suite? Even renting a bedroom can offset your higher renewal rate. In Toronto or Vancouver, $1,100–$1,400/month for a room isn’t unheard of.
Can You Refinance? Maybe — But Be Careful
If you’re with a private lender or on a variable that’s spiked, refinancing might make sense. But if your credit is below 620, most mainstream lenders won’t touch you without big equity and big fees. Private refinancing could cost you 3–4% upfront fees and rates above 9%. Crunch the numbers first.
What Redditors Are Saying
- “Renewal came up, got hit with 6.7% from CIBC. No idea what to do.” — Yep, that’s common. Your best bet is to push back and ask for a short-term fix.
- “Trying to switch lenders but my credit score dropped in the last year…” — Same here. Most lenders won’t let you switch under 680 without extra conditions.
TL;DR
- Mortgage rates suck. Especially if your credit does too.
- Call your lender before your renewal hits
- Try to boost your credit score even by a bit — it does help
- Consider creative income or rental strategies
- Don’t be afraid to ask dumb questions — Reddit is full of people in the same boat
This economy is a mess, but you’ve got options. You just need to fight a little harder to find them.
Marc has been involved in the Stock Market Media Industry for the last +5 years. After obtaining a college degree in engineering in France, he moved to Canada, where he created Money,eh?, a personal finance website.
